With debt talks at a stalemate, Congress gets creative

Just as John Boehner announced that after weeks of negotiation, “no substantive progress has been made” toward resolving the fiscal cliff, frustrated members of congress have come forward with an unconventional solution to January’s impending debt crisis.

The solution in question, leaked by several unnamed sources in the Democratic power structure, is meant to deal with a key hang-up in the policy wrangling going on between Speaker Boehner and President Obama. Boehner is threatening to block another debt ceiling increase if Republicans can’t get more favorable concessions from Democrats in the form of spending cuts and fewer new taxes. Obama refuses to include the debt ceiling in any negotiation, calling threats to block its increase “irresponsible.”

Until an agreement on the debt ceiling is reached, progress on other sticking points, like higher income tax rates or Medicare reform, remains stalled. That’s why the “constitution option” floated by congressional Dems involves exploiting an obscure clause in the 14th amendment to completely bypass the debt ceiling once and for all. As The Huffington Post’s Sam Stein explains:

Should the debt ceiling issue remain unresolved heading into the next Congress, there is one additional option that Democrats could explore. There is a legal school of thought that holds the debt ceiling to be inherently unconstitutional, calling it a violation of the 14th Amendment, which declares that the validity of the public debt “shall not be questioned.”

The White House scoffed at this argument during the summer of 2011, saying privately that it lacked a legitimate legal bearing and would do little to instill confidence among those buying U.S. debt. That could be so. But as a political matter, it’s a tool that Democrats currently say they are willing to revisit.

Students of history will recall that the debt ceiling was created during World War One to control high levels of government spending during the first major war of the 20th century. Since then, the ceiling, which acts essentially like the credit limit on a credit card, has been gradually and consistently increased by the House of Representative to “keep the lights on” in Washington.

Clearly, threatening a repeat performance is dangerous territory for Republicans, who will likely get the blame for further downgrades. Messing with the government’s interpretation of the constitution, as Democrats are proposing here, is also politically risky.

My bet is that the debt ceiling will be raised as part of a larger bargain to descend the fiscal cliff, so the constitution option (whose mechanics haven’t even been spelled out yet) won’t be used. But the fact that Democrats are mentioning re-examining the rules of our nation’s founding document to get past a monetary dispute is an unfortunate example of just how divided Washington remains.